Neco 2019 Economics Question 50
Practice objective / multiple choice question 50 from the 2019 Neco Economics examination.
The reserve requirement ratio is \( 10\% \) and the public holds \( \text{₦}0.25 \) of currency for every \( \text{₦}1 \) of deposits (currency‑deposit ratio \( c = 0.25 \)). The central bank purchases government securities worth \( \text{₦}500 \) million, injecting the same amount as reserves into the banking system. Using the money multiplier, calculate the total change in the money supply (in millions of naira), rounded to two decimal places.
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About This Question
This is Neco 2019 Economics Question 50. It is one of the objective questions from the 2019 Neco Economics examination.
Difficulty level: Medium .
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